Despite the hype surrounding technologies such as AI, productivity stats around the world remain moribund. A common accusation is that productivity growth is so low because the adoption of the latest technologies is so uneven across the economy, with smaller firms especially slow at adopting technology such as AI.
It’s easy to assume that smaller firms simply lack the funds and knowledge to make successful use of AI, but research from Rensselaer Polytechnic Institute suggests this might not be the case. It argues that for many firms, AI and other new technologies do little to improve performance, and therefore not adopting them is perfectly rational.
“AI has the potential to upend our ideas about what tasks are uniquely suited to humans, but poorly implemented or strategically inappropriate service automation can alienate customers, and that will hurt businesses in the long term,” the researchers say.
To automate or not
The best approach is to consider just how AI can help your business from a strategic perspective. For instance, the authors suggest that if a key part of the business revolves around human interaction, or a highly personalized offering for each client, then AI may have less to offer.
The researchers urge leaders to carefully consider the kind of work employees do, and how effectively that can be replaced or augmented by existing technology.
“The ideas are of use to managers, as they suggest where and how to use automation or human service workers based on ideas that are both sound and practical,” the researchers say. “Managers need guidance. Like any form of knowledge, AI and all forms of service automation have their place, but managers need good models to know where that place is.”
What’s more, the authors also urge businesses who depend heavily on building and maintaining trust with their client base, then humans are likely to maintain their edge over AI-based technologies. By contrast, if human biases negatively affect the work people do, then AI may be a more effective tool to deploy.
Of course, as the author concedes, most applications of AI will be augmenting humans rather than replacing them, but they still urge leaders to consider whether the technology really will help their business.
“Automation and human workers can and should be used together,” the author concludes. “But the extent of automation must fit with the business’s strategic approach to customers.”
